Ozzie to leave Microsoft: future cloudy

Ray Ozzie, Bill Gates's replacement as Microsoft's Chief Software Architect, is leaving the company. The news emerged in Steve Ballmer E-mail to Employees on Ray Ozzie Transition, where CEO Steve Ballmer told staff that Ozzie "will remain with the company as he transitions the teams and ongoing strategic projects within his organization" and that he will work in the Entertainment Division for a while.

Ray Ozzie, Bill Gates's replacement as Microsoft's Chief Software Architect, is leaving the company. The news emerged in Steve Ballmer E-mail to Employees on Ray Ozzie Transition, where CEO Steve Ballmer told staff that Ozzie "will remain with the company as he transitions the teams and ongoing strategic projects within his organization" and that he will work in the Entertainment Division for a while. "Beyond that, Ray has no plans at this time," said Ballmer.

Ozzie's job wouldn't have existed if it hadn't been created to keep Gates involved with Microsoft's software strategy, and it has now stopped existing. Ozzie won't be replaced. It might be surprising that it has only lasted for four or five years. Microsoft gathered Ozzie by buying his company, Groove Networks, in 2005 and integrating its product into Microsoft Office. He officially took over the CSA job in 2006, and has been mostly invisible ever since.

One of Ozzie's seminal contributions to Microsoft was his memo, The Internet Services Disruption, published on October 28, 2005. This echoed Bill Gates's famous 1995 memo, which committed Microsoft to the Internet. Ozzie committed the company to cloud-based services and raised the issue of a "new business model … in the form of advertising-supported services and software".

The internal mantra for Microsoft became embodied in the demand for "three screens and a cloud". As Ozzie explained during his Churchill Club talk in 2009:

"There's kind of a -- in order to get things going across the company you need meetings, you need to say things, say them again, and say them again. So we say three screens and a cloud, three screens and a cloud, three screens and a cloud, throughout the company. And what that means is everything we deliver, from a user experience perspective, will be -- will have some aspect of its value delivered across the PC class of device, the phone class of device, and the TV class of device. Every one of them will have something, and all will be connected to the cloud. That will bring them all together."

Clearly, Ozzie didn't have the Power of Bill, not having co-founded the company and not being the world's richest man. Still, under Ozzie's watch, Microsoft started to move its own applications -- Hotmail, Messenger, etc -- off Windows and into the cloud, with them all being redeveloped through four waves of Windows Live. Microsoft also developed cloud-based versions of Windows Server and its server applications under the Azure label. Ultimately, the Windows Live Essentials programs will all run on Azure, along with the web version of Microsoft Office and so on.

Ozzie may feel this is a good time to go, because there is no doubt that Microsoft is delivering on the strategy. Microsoft has the "three screens" with PCs running Windows 7, mobile phones running Windows Phone 7, and the Xbox 360 providing the TV connection (though Microsoft technology is also delivering IPTV services, such as BT Vision).

Microsoft is also, as Ballmer keeps saying, "all in" on the cloud, though obviously it's not going to become a one-trick pony, like Google. It's the argument for choice: customers can run their own data centres "on premise", use hosted applications, run their own cloud or use Microsoft's cloud, or any combination thereof, with Microsoft support. Since large companies are going to move to cloud computing in small steps, if at all, Microsoft can make money from helping them make the transition.

Microsoft hasn't done very much with the "new business model … in the form of advertising-supported services and software". However, it's far from being alone in that respect, and it probably isn't Ozzie's fault.

This post was published on Monday night and has been updated with the addition of the penultimate paragraph.

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